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Erin is registered for sales tax.During May, she sells goods with a tax exclusive price of $600 to kyle on credit. As kyle is buying a large quantity of goods, Erin reduces the price by 5%. She also offers a discount of another 3% if kyle pays within 10 days. Kyle does not pay within the 10 days.
Please let me know that the discount of another 3% should be considered in account or directly ignore it.
Thank you
Sales tax is calculated after subtracting both discounts.
Even if they do not end up getting the discount for paying early, the tax is not recalculated 🙂
(This is really a UK tax rule and as such I do not really think it would be fair of the examiner to ask it in F3 (because F3 is not a tax exam), however just in case, what I have written above is the rule 🙂 )
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